Ross, you're talking about alpha transparency, not texture masking. It's an easy mistake because the vocabulary of 3D graphics is so muddled and inconsistent. For example, a "masked texture" is different from a "mask texture." Oi vay
Blitz doesn't support texture masking such as you describe. That kind of effect CAN be done using vertex alpha. For example, ALE uses vertex alpha for painting tiled textures on terrain.
ADDITION: Oh yeah, and have a look at this code sample of using vertex alpha to paint tiled textures onto terrain
http://www.blitzcoder.com/cgi-bin/showcase/showcase_download.pl?id=world_creator03182003021343&fileurl=http://s93726732.onlinehome.us/blitz/transition.zip
Blitz doesn't support texture masking such as you describe. That kind of effect CAN be done using vertex alpha. For example, ALE uses vertex alpha for painting tiled textures on terrain.
ADDITION: Oh yeah, and have a look at this code sample of using vertex alpha to paint tiled textures onto terrain
http://www.blitzcoder.com/cgi-bin/showcase/showcase_download.pl?id=world_creator03182003021343&fileurl=http://s93726732.onlinehome.us/blitz/transition.zip